Correlation Between Citigroup and Blackrock Intl
Can any of the company-specific risk be diversified away by investing in both Citigroup and Blackrock Intl at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Citigroup and Blackrock Intl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Blackrock Intl A, you can compare the effects of market volatilities on Citigroup and Blackrock Intl and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Citigroup with a short position of Blackrock Intl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Blackrock Intl.
Diversification Opportunities for Citigroup and Blackrock Intl
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citigroup and Blackrock is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Blackrock Intl A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Intl A and Citigroup is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Citigroup are associated (or correlated) with Blackrock Intl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Intl A has no effect on the direction of Citigroup i.e., Citigroup and Blackrock Intl go up and down completely randomly.
Pair Corralation between Citigroup and Blackrock Intl
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.81 times more return on investment than Blackrock Intl. However, Citigroup is 1.81 times more volatile than Blackrock Intl A. It trades about 0.07 of its potential returns per unit of risk. Blackrock Intl A is currently generating about 0.04 per unit of risk. If you would invest 4,206 in Citigroup on August 26, 2024 and sell it today you would earn a total of 2,778 from holding Citigroup or generate 66.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Blackrock Intl A
Performance |
| Timeline |
| Citigroup |
| Blackrock Intl A |
Citigroup and Blackrock Intl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Blackrock Intl
The main advantage of trading using opposite Citigroup and Blackrock Intl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Blackrock Intl can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Blackrock Intl will offset losses from the drop in Blackrock Intl's long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
| Blackrock Intl vs. Blackrock California Municipal | Blackrock Intl vs. Blackrock Balanced Capital | Blackrock Intl vs. Blackrock Eurofund Class | Blackrock Intl vs. Blackrock Funds |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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